Why Groupon Not As Rosy As It Appears

Rambo Tribble writes "CNN is running an article detailing the dubious history of Eric Lefkofsky, Groupon's chairman and largest shareholder. It would seem Mr. Lefkofsky has an extensive history of taking investors' money for himself, then bankrupting the businesses invested in." Another article posted today at TechCrunch explores one businesswoman's story of how working with Groupon was the single worst business decision she ever made.

Comments

A winner in some situations

[lucm]

The only winning scenario for retail on Groupon is when you have excess inventory which will end up spoiled or heavily discounted anyways. In this case Groupon is awesome because not only do you make a few dollars on lousy stuff, you also take a shot at hooking a repeat customer or two. Just look at the Dell deals or at the bargain table outside your local bookstore... they've done it for years!

Using Groupon to give away your good stuff does not make sense.

If it walks like a duck...

[gklinger]

I highly recommend reading an article titled Groupon is Effectively Insolvent in which the author draws a compelling parallel between Groupon and a Ponzi scheme.